Randy Lerner ploughs in more money as Aston Villa wages soar

Aston Villa lost more than £37 million last season and were reliant on an
investment of £25 million from owner Randy Lerner, taking his personal
investment in underwriting the club to more than £200 million.

The loss, to the end of May 2010, of £37.6 million was £9 million less than in 2008-09, but it underlines Villa’s reliance on Lerner’s largesse and the huge cost of attempting to compete for Champions League football. It also demonstrates that, like many of their rivals, Villa have to drastically reduce their dependence on their benefactor if they are comply with Uefa ‘financial fair play’ regulations intended to force clubs to live within their means.

Controlling the club’s spiralling wage bill will be the main challenge.

Wages were up £9 million to almost £80 million in 2009-10, swallowing every penny of a £6 million increase in turnover. Wages now account for 88 per cent of the club’s £90 million turnover, among the highest rations in the Premier League.

While increased turnover lifted Villa into the top-20 earning clubs in Europe for the first time, they are more reliant on broadcast revenues, worth £52 million last season, than their rivals.

Matchday turnover at Villa Park was £24 million, £13 million less than Tottenham despite a larger capacity than White Hart Lane, and commercial income was £14.4 million. Losses were also offset by a profit of £18.3 million on the sale of Zat Knight, Gareth Barry and Craig Gardner.

Villa finished sixth for the third consecutive year last season but manager Martin O’Neill resigned on the eve of this season. A disagreement over the club’s future direction, and an apparent unwillingness to fund transfer purchases, are understood to have been factors.

Lerner has since funded the £23.5 million purchase of Darren Bent in the January transfer window, and the latest accounts for Villa’s parent company, Reform Acquisitions Limited, reveal the scale of Lerner’s investment in the club.

Since taking control at Villa Park in 2006 he has injected £205 million in the form of equity and loan notes to underwrite player purchases, infrastructure and losses.

Last season Lerner put in £25 million, £12.5 million via the issuing of new shares, with a further £12.5 million in loan notes repayable in 2019.

Lerner’s total equity investment in the club now totals £115 million, and the total loans stand at £90 million. Villa also has a bank loan of £20.5 million, £2.5 million of which has to be repaid by July 2012.

Despite the fee paid for Bent, Lerner is understood to remain committed to the cost-cutting agenda and the club is hoping to become more reliant on academy products such as Marc Albrighton and Nathan Baker to achieve this.

Club sources said they are confident that they will be able to comply with Uefa’s regulations by the time they are implemented in full at the start of the 2013-14 season.

Ashley Young’s future at Villa appears uncertain after the forward again ignored an opportunity to indicate he has an interest in remaining in the Midlands. “I have always said I will leave talks until the end of the season and that’s how it is,” he said.

With Manchester United, Liverpool and Tottenham thought to be interested in the sometime England international, Villa are understood to be pessimistic about their chances of keeping him.